Its done! Today President Barack Obama signed the Jumpstart Our Business Startups or JOBS Act. The law relaxes several regulations, particularly rules for initial public offerings. The hope is that this will enable small, private companies to go public, easier and cheaper, thus generating more jobs.
Under the new law;
- businesses would not need to provide audited financial statements or hire auditor
- would not have to adhere to “say on pay” executive compensation rules
- would be excused from new national accounting standards for up to 5 years, and
- the threshold of shareholders subjecting a company to SEC rules is increased from 500 to 2,000
Many of the bill’s provisions go into effect immediately, but the SEC must begin to draft the rules in many areas, including Crowdfunding. Although slightly controversial, Crowdfunding would give entrepreneurs and startups the ability to attract a new audience or pool of investors. We look forward to seeing the SEC’s response.
Author: Jennifer Trowbridge, Stoecklein Law Group